20 Nov October Report – From the TAR Government Affairs Department
October Article| 2019
Issue 300 Passed in Telluride
The Town of Telluride now has a short-term rental tax as voters approved Ballot Issue 300 on 56 percent of the ballots, according to complete but unofficial results in early November. The new 2.5 percent tax will feed into the town’s Affordable Housing Fund, pushing the total tax on short-term rentals from 12.65 percent to 15.15 percent. The tax does not affect hotel rooms.
Election Results – Telluride Has a New Mayor
Telluride’s new mayor DeLanie Young defeated incumbent Mayor Sean Murphy by a 53-41 margin that was sufficient to negate the need to set instant runoff voting (IRV) protocols into action. David Oyster finished a distant third with 6 percent.
In the Telluride Town Council race, Telluride voters sent the incumbent, Lars Carlson, back to work on Town Council and gave Adrienne Christy a handy second-place finish and a seat on council with 39 percent and 38 percent of the votes, respectively. Carlson was the top vote getter with 459 votes to Adrienne Christy’s 429.
Young, Carlson and Christy took the oath of office Nov. 19.
Proposition CC Fails at the Statewide Level
Proposition CC, a statewide initiative that asked voters to give up statewide TABOR refunds indefinitely was defeated in early November by a 55% – 45% margin.
- A “YES” vote would have allowed the state to keep revenue above the current limit instead of issuing TABOR refunds on years when the state collects too much. The money from CC would have been added to the general revenue where it would be spent on things such as schools and roads.
- A “NO” vote keeps the current structure in place where the state would have to issue TABOR refunds for revenue above and beyond the required limit.
Voters were NOT being asked to give up your state-issued income tax refunds. This only deals with excess money the state collects that is currently required to be refunded to voters.
Not every year, but in some years, Colorado must refund you money because of the Taxpayer’s Bill of Rights, which you might know as TABOR.
Voters passed TABOR in 1992. The Constitutional amendment requires the state and local governments to get voter approval before enacting new tax increases or bonds, and it puts a cap on how much tax money Colorado can collect and spend. The rate is based on inflation and population. If the state collects too much, you get back money.
Proposition DD Passes Statewide by a Razor Thin Margin
Colorado voters have approved a ballot measure legalizing sports betting and taxing it to help fund a state water conservation plan. Proposition DD passed 50.7% – 49.3%. It had bipartisan support and only token opposition. The election was so close that the outcome could only be determined after each and every vote was tallied.
The measure allows Colorado’s 33 casinos to start offering wagering on professional, collegiate, motor and Olympic sports in May. Both in-person and online wagering are allowed.
Colorado can legalize sports betting because of a U.S. Supreme Court ruling in May 2018. However, Colorado law explicitly makes sports betting illegal. DD attempts to make it legal, while at the same time initiating a new voter-approved tax on the revenues from sports betting, to be spent on Colorado’s Water Plan.
National News – Agencies Increase Residential Appraisal Threshold
On September 27, 2019, the Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, and the Federal Deposit Insurance Corporation (collectively “the Agencies”) adopted a final rule increasing the threshold for requiring an appraisal in residential real estate transactions from $250,000 to $400,000. Federally related transactions under $400,000 will require an evaluation, rather than a full appraisal, to determine value of the real estate in question. A federally related transaction is a non-Fannie Mae or Freddie Mac transaction and a non-federal financed transaction, such as loans under the Federal Housing Administration, the Rural Housing Service or the Department of Veterans Affairs.
House Passes SAFE Banking Act – A Win for States with Legal Weed
On Wednesday, September 25, the House passed H.R. 1595, the “Secure and Faire Enforcement (SAFE) Banking Act,” by a bipartisan vote of 321 – 103. This bill, cosponsored by Representatives Ed Perlmutter (D-OR) and Steve Stivers (R-OH), creates a safe harbor for federally-insured financial institutions to provide services to cannabis-related businesses in states that have legalized the substance.
Currently thirty-three states and the District of Columbia have legalized cannabis for medicinal or recreational use, but it remains a Schedule-1 narcotic under the Controlled Substances Act. As a result, legitimate cannabis businesses in states that have legalized the substance, or businesses that derive any income from them – including real estate – can’t work with federally-insured financial institutions due to anti-money laundering laws. This means that many such businesses have to operate on a cash-only basis, which creates difficulty collecting taxes and enforcing regulations, as well as increases safety risks to the communities they are in. The SAFE Banking Act would create a safe harbor allowing financial institutions to work with legitimate cannabis businesses, thus resolving those issues.
NAR supports the rights of states and residents of those states to create laws aligned with state and resident interests. NAR supports allowing businesses that are properly registered and that are legitimate by state standards to have the ability to access banking services. NAR sent a letter of support for the SAFE Banking Act to the full House of Representatives ahead of the vote, urging them to pass it, and also joined a coalition letter which included the American Bankers Association and the Credit Union National Association, as well as Scotts Miracle Grow. The Senate Banking Committee held a hearing on this issue in July, and is expected to hold a markup of its companion bill, S. 1200 (cosponsored by Senators Cory Gardner, (R-CO) and Jeff Merkley, (D-OR)) before the end of the year.
This monthly government affairs/public policy report is prepared for information purposes for the members of the Telluride Association of REALTORS® (TAR). It is a snap shot of issues important to the real estate industry at the local, state, and national levels. Any position taken on local issues is done at the direction of the TAR Board of Directors and is done with considerable debate and discussion by TAR leadership. Positions taken by CAR or NAR on issues at the state and national level will be reflected in the article when applicable.